The standoff began on Monday when around 200 fighters from the Moro National Liberation Front (MNFL) stormed several coastal communities in Zamboanga City, taking residents hostage and reportedly using some as shields.

Fighting between the Muslim rebel group and government troops has left 22 dead, with around 24,000 locals forced to leave their homes due to the violence.

The conflict spread to the island of Basilan on Thursday, resulting on one death before residents were evacuated.

But in a sign of hope, talks between Philippines Vice-President Jejomar Binay and rebel leader Nur Misuari by telephone on Friday ended with an agreement to halt conflict.

"The details of a peaceful settlement can be threshed out with a cease-fire in place," Binay told the Associated Press news agency.

At the heart of the conflict is the MNFL's disillusionment with what it sees as broken government promises over the establishment of an autonomous region for Muslims in the largely Catholic nation's Mindanao region. The MNFL signed a peace deal with the Philippines government in 1996 but Misuari refused to lay down arms. The Moro Islamic Liberation Front (MILF), a more prominent Muslim group seeking independence, has had more success negotiating with the government.

Rebels 'should not cross' line

Philippines President Benigno Aquino visited Zamboanga on Friday, describing Misuari's actions as a “desperate” attempt to scupper peace efforts. Officials said rebels had set fire to many homes, with four blazes still raging across Zamboanga.

Aquino also warned the rebels there were some “lines they should not cross.”

"Our forces and equipment on the ground are overwhelming," Aquino said at a news conference.

"We're not setting a deadline but we have decisive points. If they harmed hostages, resorted to arson and crossed other lines that should not be crossed, our security forces have instructions on what to do."

The MILF is reportedly in the final stages of peace talks with the Philippines government, with a view to taking over an expanded autonomous Muslim region in the south of the country by 2016.

ph/dr (AP, AFP)